- Apollo Tourism & Leisure (ATL) has outlined its latest measures to combat COVID-19’s impact on the company’s operations
- Wide-spread travel bans and shelter-in-place restrictions have reduced demand for the company’s recreations vehicles
- Consequently, the company has placed its U.S. rental operations in hibernation until mid-2021, which will result in a loss of around $12 million over the year
- During the hibernation period, Apollo has arranged to sell its fleet to a series of dealers to help reduce debt and associated costs
- Furthermore, Apollo is closing its New Zealand manufacturing facility until new vehicles are required in the region
- Apollo Tourism & Leisure is up 3.64 per cent on the market today, with shares trading for 28.5 cents each
Apollo Tourism & Leisure (ATL) has outlined its latest measures to combat COVID-19’s impact on the company’s operations.
The company manufactures, rents and sells recreations vehicles, with operations in Australia, New Zealand, Canada, the United States, Germany, the United Kingdom and Ireland.
Ongoing shelter-in-place and travel restrictions have severely impacted the global tourism industry, including Apollo’s rental and wholesale market.
Since the end of last year, the company’s cash-in-hand has dropped from $17.3 million to $12.4 million.
In an effort to retain liquidity, the company has placed its U.S. rental operations in hibernation until mid-2021. This will result in a loss of around $12 million in the company’s financial year 2020 report.
During the hibernation period, Apollo has arranged to sell its fleet to a number of its dealer partners. In doing so, the company will substantially reduce the fleet’s $60.5 million in debt, as well as eliminate insurance, registration and repayment costs.
After already reducing staff across its business, Apollo has also implemented further salary reductions, with members of the Board take a 30 per cent cut.
These staff and salary reductions, when coupled with government assistance packages, will decrease the company’s expected employment costs by 70 per cent.
Furthermore, due to the quarantine measures in New Zealand, Apollo is closing its NZ manufacturing facility until new vehicles are required in the region.
Apollo’s Managing Director and CEO, Luke Trouchet, believes the company has acted quickly and industriously, in the face of unprecedented challenges.
“The impact of the Coronavirus and its associated government restrictions has been devastating for the tourism industry, however, Apollo has responded quickly and implemented initiatives that will assist us to navigate through this unprecedented time,” Luke remarked.
“In addition to the plans we have put in place, we continue to work on further initiatives to stimulate demand, improve liquidity and reduce costs. These actions give us confidence that the business will be in a position to benefit when tourism activity recovers,” he said.
Apollo Tourism & Leisure is up 3.64 per cent on the market this morning, with shares trading for 28.5 cents each at 10:00 am AEST.